Canada’s dollar dropped for a third day, tracking crude oil and global stocks, as investors sought traditional havens in the U.S. dollar, the Swiss franc and the yen on concern about soaring bond yields in Italy and Spain. The loonie, as the Canadian currency is also known, rose against the euro, which fell to a record low against the franc and breached an important technical barrier versus the U.S. dollar. A meeting of European Union finance ministers yesterday failed to quell the region’s escalating debt crisis. “The focus is increasingly turning to Spain and Italy,” said Ankita Dudani, a currency strategist at Royal Bank of Scotland Group Plc, by phone from London. “Commodity currencies are holding in OK. We’re quite optimistic on the prospects for global recovery.” The Canadian currency depreciated 0.3 percent to 97.18 cents per U.S. dollar at 8:01 a.m. in Toronto, compared with 96.88 cents yesterday. It rose as much as 0.6 percent to C$1.351 per euro, the strongest since March 14. One Canadian dollar buys $1.0294. The yield on 10-year Italian bonds rose as much as 33 basis points to 6.02 percent, before paring its advance to 5.74 percent. The rise pushed the premium investors demand to hold the debt over German bunds to a euro-era record of as much as 348 basis points. Italy is Europe’s biggest bond market. Crude for August delivery fell as much as 1.7 percent to $93.55 a barrel on the New York Mercantile Exchange. The MSCI World Index of stocks in developed economies declined as much as 1.3 percent. To contact the reporter on this story: Chris Fournier in Halifax, Nova Scotia at cfournier3@bloomberg.net To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net

Source